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job market papers 2017

Why don’t people migrate more? A lab experiment of sequential decision-making: Guest post by Zach Barnett-Howell

This is the sixteenth in this year’s job market series

Darling you got to let me know // Should I stay or should I go?
One way to escape poverty is to leave it behind. Literally. Moving from a poorer to richer area is so advantageous for individuals that an entire literature on migration has developed to explain why more people don't move.

If you say that you are mine // I’ll be here ‘till the end of time
Bryan, Chowdhury, and Mobarak conducted an experiment in northwestern Bangladesh to induce migration. They offered households a small subsidy to migrate, a round-trip bus ticket worth $8.50. This proved sufficient for people to migrate, and those who migrated earned more and enjoyed higher levels of welfare. So it brought up a new question: why hadn’t those households already decided to migrate?
 
This immobility is problematic because it’s not supposed to happen. Foundational migration theories, like the Harris-Todaro model, were designed to explain movement from poorer to richer areas. These migrations made sense: people were arbitraging wages and other amenities across space, receiving more by being elsewhere. But how can we explain the opposite—people who don’t migrate—when the welfare gains would be tremendous?

If I go, there will be trouble // if I stay it will be double
In my job market paper I explain why people rationally would not make moves that offer higher welfare. I do this by modeling migration as a sequential decision where people try to figure out which location would suit them best.

A family affair: are dynastic CEOs really worse managers? Guest post by Daniela Scur

This is the twelfth in this years' job market series.
Family firms are the most prevalent type of firm in the world. This is especially true in emerging economies, where family firms account for over half of medium-sized firms in the manufacturing sector. In particular, dynastic family firms – that is, where the founding family owns a controlling share and have appointed a second-generation (or later) family member as the CEO – account for a quarter of these firms. Since supporting such firms as the “backbone of the economy” is very politically popular (as this skilfully edited video from Last Week Tonight with John Oliver shows), it is crucial to understand more about these firms. More specifically, we need to understand how they operate and what their impact is on the economy and labour markets. Although there is mixed evidence on whether family ownership is a good thing, the weight of the evidence is that dynastic family CEOs are usually bad news for productivity. But why is that the case?

Workers Unite: Cooperative Property Rights and Development in El Salvador - Guest post by Eduardo Montero

This is the eleventh entry in this year's job market series. You can read the previous entries here.

"On March 5th, we went to sleep as poor colonos [laborers]. On March 6th, we woke up rich, as landholders."  –Cooperative Member, La Maroma Cooperative, 2017

Cooperative Property Rights in Latin America

Latin America has high levels of land inequality. In fact, land inequality is frequently cited as a key driver of Latin America’s comparative underdevelopment. In response to these high levels of inequality, over half of Latin American countries have attempted land reform programs to transform haciendas, in which an owner contracts laborers to work on the land, into agricultural cooperatives, in which workers jointly own and manage production. The figure below illustrates the Latin American countries that have attempted a land reform since the 1920s.
 

 

Avoiding #MeToo: Harassment Risk and Women’s College Choice -- Guest post by Girija Borker

This is the tenth entry in this year's job market series. You can read the previous entries here.

Street harassment, or sexual harassment in public spaces, is a serious problem around the world. In Delhi, 95 percent of women aged 16-49 report feeling unsafe in public spaces (UN Women and ICRW 2013). Women incur significant psychological costs from sexual harassment (Langton and Truman 2014) and actively take precautions to avoid such confrontations (Pain 1997). However, there is limited evidence on the economic costs of daily harassment. Moreover, there is no quantitative evidence of the effect harassment has on women’s human capital attainment.
 
One potential cost of an environment in which street harassment is prevalent is that women may avoid opportunities that would otherwise be available to them. In Delhi University (DU), for example, women tend to attend lower quality colleges than men, even though on average they do as well or better than men on the national high school exams. In my job market paper, I ask whether women choose to attend lower quality colleges in order to avoid sexual harassment while travelling to and from college. I answer this question in a context where 71 percent of the enrolled students live at home with their families and travel to college every day, mostly by public transport, and where over 89 percent of female students have faced some form of harassment while traveling in the city. Specifically, 63 percent of female students have experienced unwanted staring, 50 percent have received inappropriate comments, 40 percent have been touched, groped, or grabbed, and 26 percent have been followed.  I find that women’s college choice can be explained in part by their concerns about exposure to street harassment.
 

Pricing water when the poor share: evidence from Manila: Guest post by William Violette

This is the ninth in this years' job market series
Despite large investments in piped water throughout the developing world, the share of urban households without piped water has remained stable at 5% for middle-income countries and at 20% for low-income countries over the past decade.  Given health, time-savings, and other benefits from piped water, how can water utilities set prices in order to close gaps in access while still covering costs?  Conventional wisdom is that subsidizing fixed connection fees with high marginal prices can improve access especially for the poor, but this policy can have the opposite effect when households share water connections, which is common in the developing world.  I observe that over 23% of households in Manila access piped water through a neighbor's connection.  In this context, high marginal prices weaken incentives for households to extend water access to their neighbors through sharing.  Similarly, connection fee subsidies may have limited impacts on access because sharing households already split any fixed costs with their neighbors.

Female condoms - a technology for women with low bargaining power? Guest post by Karlijn Morsink

This is the eighth in this year’s series of posts by PhD students on the job market. 

Condoms are the only well-established technology that protect against sexually transmitted infections (STIs). Yet in 2015 alone, an estimated 3.3 billion risky sex acts took place without condoms in Sub-Saharan Africa, leading to 910,000 new HIV infections (UNAIDS, 2016a). Women disproportionally bear the costs associated with risky sex: they are more vulnerable to HIV infection, and carry the burden of unwanted pregnancy (UNAIDS, 2016b). Yet despite women standing to benefit most from condom use, the decision to use a condom is joint, and both sexual partners must agree. Thus women with low bargaining power may struggle to convince their male partners to use condoms.

Taxing Clients? How Clientelism Hurts Citizen Tax Morale in Benin: Guest post by Sanata Sy-Sahande

This is the seventh in this year’s job market series.
Developing countries regularly underperform in their capacity to collect taxes, with tax revenue to GDP ratios that are 20 to 30 percent less than those of high-income countries (Besley and Persson, 2014). This tax capacity gap represents lost revenue that could have provided much-needed public goods and services while reducing reliance on foreign aid. This issue is especially relevant in Africa, where “shadow economies” comprise up to 75% of national GDP (Schneider and Enste 2000), indicating that large swaths of these countries’ populations manage to evade taxation. What accounts for this failure to convince citizens to pay taxes?
 
Structural roadblocks to tax collections in developing countries include poor service quality, dysfunctional bureaucracies, and outdated equipment. In contrast, my job market paper provides a political explanation centered on clientelism, or politicians' exchange of targeted goods for votes from loyal supporters.

Should people be paid to apply for jobs? Guest post by Stefano Caria

This is the sixth in this year’s job market series 
                                                                          
Labor misallocation is believed to be a key driver of differences in income across countries (Hsieh and Klenow 2010). However, the causes of this misallocation are not always well understood and there is little evidence on what interventions can improve the allocation of workers in the economy. These issues are particularly important in Sub-Saharan Africa, where worker mobility from low to high productivity sectors is often limited (McMillan, Rodrick and Verduzco-Gallo 2014).
 
My job market paper provides new experimental evidence from Ethiopia showing that subsidizing job applications can reduce inefficiencies in the allocation of workers’ talent.


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